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People migrating between occupations experience frictional unemployment, that have nothing to do with the market recession and is entirely voluntary. Changes in the economy, such as technological advancements or industry declines, cause structural unemployment.

Frictional and structural unemployment combine to form the natural unemployment rate.In other words, the natural unemployment rate includes both frictional and structural unemployment.If more persons classed as frictionally unemployed decide to quit looking for work and instead start their own business, the percentage of frictionally unemployed people will decrease.Frictional unemployment, as previously noted, is a component of the natural rate.As a result of the decrease in frictional unemployment, the level of unemployment will also decrease.

Frictional unemployment is decreasing, as indicated in item $\left(a\right)$, more as frictionally unemployed people start their own businesses and therefore find work.

Because of the decrease in frictional unemployment, the unemployment rate will reduce at any given amount of inflation, and the economy's Philips curve will move to the left.